Author Topic: Getting Started in Canadian Investing  (Read 7973 times)

Mattzlaff

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Getting Started in Canadian Investing
« on: April 17, 2015, 01:52:59 AM »
Hello all.

I've been reading a lot of MMM for a long time. Recently jumped on the forums because no matter how much reading I do I still never feel comfortable jumping into investing. I've read over questrade posts and investing posts but I just don't know where to start. I would call myself a novice in terms of saving money and investing it.

Here's how it roughly looks

I'm a 24 year old Canadian I work shift work in the great white north petrochemical industry
I make 102k Net with varying amounts of overtime and extra pay outs from work not included in the salary.
I have somewhere north of 22k CAD$ sitting in a bank account accumulating a laughably low 1% interest.
I have a relatively large debt from a car loan and ~5000$ student loans which I have thought about paying off numerous times just never get around to it
I own a mortgage which started this January, well according to my rudimentary math somewhere north of 11% of my house.
8% of my salary goes into an RRSP account where my company matches 4% into a registered fund. Which only needs 7% for the companies 4%
My company pays 4% of my salary towards a DCPP
Company offers an ESPP which I missed out on last year but purchase this year and my first year and profited around 2000$
Besides my loan payments and bills my montly spending tends to vary depending on how much I indulge in my vices like video games, movies, and beer...lots and lots of beer.

I want to start making my money work for me but I lack the confidence to start going out and purchasing ETFs/stocks/bonds ect on my own. But I also don't want to get swindled with high fees from brokerages if I even knew where to start with the banks...

And basically as a whole I really don't know what I'm doing...

So I'm asking for some advice to get started I have a feeling most of everyone will say to tackle all of my debt then start venturing into the world of investing I'm just not sure. If needed I can go into more detail of what I'm actually doing with all my not so hard earned money however I'm mainly asking for investing advice and not for advice to clean up my ugly spending habits, which I'm doing slowly.


GuitarStv

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Re: Getting Started in Canadian Investing
« Reply #1 on: April 17, 2015, 06:11:54 AM »
http://canadiancouchpotato.com/couch-potato-faq/

It's worth reading over this website . . . it explains a lot about basic investing and how to set up an easy to manage, low maintenance method for a Canadian.
« Last Edit: April 17, 2015, 06:15:18 AM by GuitarStv »

iwanttoretireplease

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Re: Getting Started in Canadian Investing
« Reply #2 on: April 17, 2015, 07:40:12 AM »
I suggest opening up a questtrade account. Open up a TFSA with questtade and invest in index etfs. Etfs are traded free on questtrade. Buy the same amount every month. Also Dividend stocks have merit too, as long as you reinvest your dividends. Im in the same industry. Good for you for investing your money instead of buying that new truck like alot of our co workers do.

plainjane

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Re: Getting Started in Canadian Investing
« Reply #3 on: April 17, 2015, 09:12:57 AM »
You're probably pretty close to maxxed out on your RRSP contributions, but take a look to see if you've been carrying over anything from previous years.  Otherwise, you've got lots of contribution room in your TFSA to fill with investments for now.

What is the interest rate on your student loans?  Car?  Personally I'd kill the student loan, just to have it out of the way, but that may be an emotional decision vs. mathematical.

Also, consider how stable your job is and how big an emergency fund you need as a single person - especially given the recent volatility.

J.Milly

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Re: Getting Started in Canadian Investing
« Reply #4 on: April 17, 2015, 05:23:50 PM »
I would think to cover the Student loan at least to start with. I agree with Jane youre probs max on RRSP contributions so your goal should be to max out your TFSA next, ^^ great suggestion about Canadian Couch Potato, personally ive been spanked recently as I just started investing too, down 4% but just gotta keep putting cash in and over time youre gonna come out ahead!

P.S. PC gaming and Steam sales are your friend!

RichMoose

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Re: Getting Started in Canadian Investing
« Reply #5 on: April 20, 2015, 10:58:12 AM »
Hey Matzlaff, welcome to MMM forums! You clearly have a ton of potential to save huge amounts of cash and be financially free at a young age if that's what you are aiming to do. Here are the steps I would take:

1) Focus on tracking your expenses and chewing them down. You should be saving at least 50% of your income and still living comfortably. After a while you will find saving comes easier and you will be able to save increasingly higher portions of your income and be happy.

2) Pay off your student loan and consider paying off your car loan if the interest is higher than 5%. If not, consider selling your expensive car and getting something that's more economical and reasonable.

3) Invest in the ESPP, but have an exit strategy. Find out what the minimum holding period is and aim to sell the allowable portions at that time so you are not too heavily invested in one company (especially one your work for). You don't want to lose your job and your savings if things go bad.

4) Once you have at least $15,000 in investable cash, set up self-directed accounts for investing: RRSP, TFSA, and Cash Investment Account. You can do this through an online brokerage like Questrade or through a big bank discount brokerage. For big banks I prefer RBC Direct because of their US$ advantages down the road. With RBC you will pay $10 per trade when you buy ETFs, but it really isn't a big deal if you invest a couple thousand bucks at a time.

5) With your accounts set up, immediately transfer the $15,000 into your TFSA, assuming you have the room. You can find out your TFSA and RRSP room by creating an online access account with the CRA. This takes just a few minutes and they will mail your access code within a week.

6) Cut your company RRSP contribution to 7% to get your full match. Invest the rest in your own RRSP, if you have the room. Within your company RRSP, make sure you are investing in low cost index funds only. If you post a list of available funds with their expense ratios on here, we can easily help you choose the best one.

7) Based on your income I would max RRSP first, then TFSA. Regardless you should be able to max out both effortlessly year after year.

8) Purchase only index ETFs. Check out Vanguard Canada's website for ETF information and the Canadian Couch Potato website for asset allocation. Follow their advice! Don't get too hung up on rebalancing and keep your whole portfolio in perspective (including your company RRSP). Also, don't worry about your investment value too much. This is a long term thing. I'm at the point where I can gain or lose a couple grand in a week. It doesn't matter until you need the money which is years down the road.

Your success depends on how badly you want to succeed and what matters to you. With your income there is no reason why you can not be financially free by the time you're 35. You can travel around the world, brew your own beer 6 gallons at a time, fish, or sell TVs at BestBuy and never run out of money or have to work again.

Or, you can live like my neighbours here in Edmonton and work the oil field till the day you die, be heavily in debt, own every toy invented by man, pay your ex-partner 1/3 of your paycheque, drive a jacked up Dodge, and generally hate the fact that you're 45 or 55 and still have to work a 2/1 rotation and have made $150k a year for many years with little to show for it.

Personally I'm choosing the former myself and at 25 y/o I'm on track to get there by the time I'm 35 or sooner.

Oh... if you haven't already, read all the MMM blog posts. He gives great perspective on what really makes you happy in life.

Mattzlaff

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Re: Getting Started in Canadian Investing
« Reply #6 on: April 25, 2015, 01:06:53 AM »
Thanks for all the valued information I wasn't able to get to a computer this past week due to my girlfriend making plans for us. Back at work on night shifts right now. I'll read the couch potato FAQ, and just looked at the CRA log in stuff, that will have to wait until I dust off some of my tax folders and home.

I'm killing my student loan whenever my latest and greatest ESPP cheque clears.

Afterwards I'm going to direct the monthly withdrawal from my account for my student loans towards my vehicle loan along with some of my savings and start killing that faster until the only debt I hold is my mortgage. From then on I'll start heavily investing/killing the mortgage. Small steps, one at a time for now.

Tuxedo, just had a few questions and probably some more insight into my situation.

I'm actually really excited to see some one from Edmonton post on this topic I live near Edmonton, thanks for your time and effort to start with.

I see the word savings thrown around a lot and I've often wondered what that word actually means, does it mean every dollar I'm investing into growth accounts (ETS, Stocks, RRSPS TFSA)? Do savings count as the % of my mortgage payment that goes towards my house and not interest as well? What should I be considering as "Saving" when all is said and done?

Do you personally have any experience using questtrade? do you do all of your investing through questtrade if you do use it? I signed up and I'm waiting for my thing in the mail, I'm a little wary about using something that's entirely directed online.

If I put money into my TFSA through my bank for now until I am able to save 15000 and try to manoeuvre it to a questtrade TFSA what does the paperwork look like/can it be done? I know for a fact that to take out of my banks TFSA and put into my spending account there is a 7$ fee, and I hate admin fees as a rule so I want to keep that to a minimum.

I don't know if this has ever been discussed but what do I do once I max out my RRSPs and TFSA? I can very much be on track to do that this year even as I start my investing at the end of May.

On the next business day I'll cut my 8% to 7% for the company plan, that keeps me at the max for my company contributions.

I probably wont sell my truck or my motorcycle, I like them too much, even though I do like to work on my bike hehehe. However I've never been into the "toys" most of my co workers are into, trailers, ATVS, "SLEDS". I do like the allure of mexico and Vegas and hope to go to either one of those locations once or twice a year.

I moved into my very first house in January and now have to dig a little bit and buy the necessary home care items, for example my bestfriend/renter just sucked up a sock and burned out my perfectly good 7 year old new hand-me-down vacuum...

I've spent a considerable amount of my free time trawling through the blog posts on this website and just recently jumped into the forums. I'm glad to be here and happy to see that I got some real local advice on my first post.

Hope to hear more from you guys.

I'll post a few screen shots of my Sunlife RRSP funds I can pick to invest in.

Mattzlaff

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Re: Getting Started in Canadian Investing
« Reply #7 on: April 25, 2015, 01:20:50 AM »
My free time has grown here at work so here's my works available choices for my investments. When I signed up I just picked which ones had the best Rate of Return

However I can't find a web based uploader that the work computer will allow me to use so I'll attach the images and hope that works.

I have invested:

65% in Fiera US Equity Fund
35% MFS Cdn Equity Value Fund


Heckler

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Re: Getting Started in Canadian Investing
« Reply #8 on: April 25, 2015, 08:39:38 AM »
Vancouver here...

Hey, that looks like a screenshot of my employer RSP account!


Here's how I handled it:

For the first 8 months with Sunlife, I followed the advisors recommended mix of higher cost funds, and I tracked their performance on a monthly basis and compared to the relevant index.  I can save you wasted fees. 

The bottom three BLK Index funds are all you need to accumulate in your Sunlife.  I'm currently 60% US and 40% EAFE (we don't get the Canadian TSX index for some stupid reason). 

Because my Sunlife contributions come off my pay, my income taxes are reduced immediately, which means I don't get a big tax refund in April because I've reduced my taxable income at source.  Therefore, I am accumulating all our RSP funds (currently 30%) annually through the Sunlife off my pay.

Now, here's the catch- I'm allowed one annual free transfer out.  Therefore, it gets moved to my self directed and then into Vanguard according to www.canadiancouchpotato.com each January. This reduces my MER fees (Sunlife calls them something else, but it's the percentage off the top you pay).
« Last Edit: April 25, 2015, 08:41:13 AM by Heckler »

Heckler

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Re: Getting Started in Canadian Investing
« Reply #9 on: April 25, 2015, 08:44:29 AM »
Because I prefer to use my banks online brokerage for self directed, it costs me $9.95/trade, so accumulating in Sunlife and transferring out annually really reduces my trading costs for the Vanguard funds.  If I were to invest a grand bi weekly into vanguard, there'd be little saving of the fees. 
« Last Edit: April 25, 2015, 09:21:34 AM by Heckler »

Heckler

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Re: Getting Started in Canadian Investing
« Reply #10 on: April 25, 2015, 08:47:51 AM »
Paperwork to transfer funds come from your receiving institute, and it typically takes a month to do, so don't plan on transferring often.  You fill out the forms and send them to Questrade and they then pull the funds from your current account. 

Heckler

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Re: Getting Started in Canadian Investing
« Reply #11 on: April 25, 2015, 08:49:56 AM »
There's a "fees" tab in your Sunlife account that will tell you the cost to transfer out.  I suspect it's unique to your employer. 

Heckler

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Re: Getting Started in Canadian Investing
« Reply #12 on: April 25, 2015, 08:55:10 AM »
Your RSP limit is $24,930 this year, and is cumulative from past years you've been working.  So, you're only half way to maxing that out.  First max RRSP, then max your TFSA.  If you can do that at 24, you're sitting pretty!

Your TFSA limit is $41k, assuming you have 0 contributions to date.

After those are maxed, you can start thinking about a taxable account.

http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/rrsp-reer/cntrbtng/lmts-eng.html
« Last Edit: April 25, 2015, 09:09:07 AM by Heckler »

Heckler

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Re: Getting Started in Canadian Investing
« Reply #13 on: April 25, 2015, 09:05:44 AM »
Sunlife has a short term trading fee, meaning you need to hold your current funds for at least a month before switching them. 

To work around this, you can change your future contributions allocation immediately, and start accumulating the BLK Index funds, and in a month our two compare their performance and fees to your MFS funds, then if you agree with me, move the MFS funds allocation to the index funds without any short term trading fees. 

Heckler

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Re: Getting Started in Canadian Investing
« Reply #14 on: April 25, 2015, 09:15:49 AM »
So, fellow indexers, how do you justify my BLK US Index funds recommendation when his current higher fee fund has a  5% better one year return??

rocketpj

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Re: Getting Started in Canadian Investing
« Reply #15 on: April 25, 2015, 10:19:32 AM »
Sunlife= evil, walled garden high MER bullshit in my opinion.*  But if that's what your workplace requires then it's worth it for the matching contribution.

Questrade and Canadian Couch Potato are your friends, seriously.  You can set up transfers to your Qtrade account when you bank online (as a bill payment).  And buying ETFs is commission free at Questrade, so you can buy as few as one share at a time without incurring costs.  I do it all the time - every time my wife or I get paid I shift cash into there and buy as many as the amount allows.

Pick a Canadian Couch Potato model portfolion, add as much as you can as often as you can, rebalance every so often.  Prosper.


*They have been real bastards about transferring out my modest account - basically forcing me to call them several times and be subjected to people trying to convince me to stay and keep paying them >2%MERs to poorly manage my money.

Heckler

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Re: Getting Started in Canadian Investing
« Reply #16 on: April 25, 2015, 10:35:02 AM »
I moved 120k into Sunlife in July, and pulled out 135k once I figured out my CCP shit.  Did it no hassle with one form submitted, no issues, and it was quicker than the $2k I'm still waiting to get out of BMO mutual funds.

RichMoose

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Re: Getting Started in Canadian Investing
« Reply #17 on: April 25, 2015, 11:21:23 AM »
My free time has grown here at work so here's my works available choices for my investments. When I signed up I just picked which ones had the best Rate of Return

However I can't find a web based uploader that the work computer will allow me to use so I'll attach the images and hope that works.

I have invested:

65% in Fiera US Equity Fund
35% MFS Cdn Equity Value Fund

Because it's your RRSP account, I would put it in a mix of BLK Bond Index and BLK US Index. Both are not too unreasonable at 0.39% MER. The ratio should be based on your own comfort & risk levels. Bonds should generally make up between 10% and 40% of your total portfolio (work RRSP, personal RRSP, TFSA, and other retirement savings accounts).

Don't get too focused on the short term outperformance of Fiera US. The fund does not have a long track record and will likely (90%+ chance) underperform the index over a long time frame. Math always wins in the end.

RichMoose

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Re: Getting Started in Canadian Investing
« Reply #18 on: April 25, 2015, 11:44:51 AM »
Thanks for all the valued information I wasn't able to get to a computer this past week due to my girlfriend making plans for us. Back at work on night shifts right now. I'll read the couch potato FAQ, and just looked at the CRA log in stuff, that will have to wait until I dust off some of my tax folders and home.

I'm killing my student loan whenever my latest and greatest ESPP cheque clears.

Afterwards I'm going to direct the monthly withdrawal from my account for my student loans towards my vehicle loan along with some of my savings and start killing that faster until the only debt I hold is my mortgage. From then on I'll start heavily investing/killing the mortgage. Small steps, one at a time for now.

Tuxedo, just had a few questions and probably some more insight into my situation.

I'm actually really excited to see some one from Edmonton post on this topic I live near Edmonton, thanks for your time and effort to start with.

I see the word savings thrown around a lot and I've often wondered what that word actually means, does it mean every dollar I'm investing into growth accounts (ETS, Stocks, RRSPS TFSA)? Do savings count as the % of my mortgage payment that goes towards my house and not interest as well? What should I be considering as "Saving" when all is said and done?  I count savings as every dollar I am putting away from retirement. For me that includes my pension, RRSP & TFSA for now (hopefully a taxable investment account in the future). My mortgage principal contributes to lower future expenses, but it does not generate returns to fund retirement so I don't include that. It could be counted if you plan on selling your house in retirement and renting. A portion could also count if you plan to downsize in retirement, leaving you with investable assets after purchasing your new home. Other people view this differently and choose to include mortgage principal reductions.

Do you personally have any experience using questtrade? do you do all of your investing through questtrade if you do use it? I signed up and I'm waiting for my thing in the mail, I'm a little wary about using something that's entirely directed online. Yes I currently use Questrade for all my investing. It works well for me. I formerly used TD Waterhouse but left them because I didn't see any added benefit for the $10 commission fees. Questrade has been around for a long time and is used by tons of Canadians without any problems. My only complaint is their customer service can be a bit lacking, although that hasn't been too much of an issue for me so far. You do get more than what you pay for in my opinion. If customer service is a concern for you, I would go with RBC Direct.

If I put money into my TFSA through my bank for now until I am able to save 15000 and try to manoeuvre it to a questtrade TFSA what does the paperwork look like/can it be done? I know for a fact that to take out of my banks TFSA and put into my spending account there is a 7$ fee, and I hate admin fees as a rule so I want to keep that to a minimum. This can cost you a transfer fee which usually runs between $100 and $200. It's not overly complicated though from a paperwork perspective. If you use Questrade their account fees are voided once you have $5000 invested with them. RBC Direct is $15,000.

I don't know if this has ever been discussed but what do I do once I max out my RRSPs and TFSA? I can very much be on track to do that this year even as I start my investing at the end of May. You can choose to aggressively pay down your mortgage, or start an Investment Account. Investment Account returns are taxable though so it will make doing your taxes a bit more complicated. Within Investment Accounts it's very important to buy and hold only as trading will result in potentially expensive tax bills. Also, Investment Accounts are likely the best place to hold your Canadian Index ETF for tax reasons (low taxes on Canadian dividends).

On the next business day I'll cut my 8% to 7% for the company plan, that keeps me at the max for my company contributions.

I probably wont sell my truck or my motorcycle, I like them too much, even though I do like to work on my bike hehehe. However I've never been into the "toys" most of my co workers are into, trailers, ATVS, "SLEDS". I do like the allure of mexico and Vegas and hope to go to either one of those locations once or twice a year.

I moved into my very first house in January and now have to dig a little bit and buy the necessary home care items, for example my bestfriend/renter just sucked up a sock and burned out my perfectly good 7 year old new hand-me-down vacuum... Amazon is your friend! I just bought a Hoover cyclone vacuum for around $150.

I've spent a considerable amount of my free time trawling through the blog posts on this website and just recently jumped into the forums. I'm glad to be here and happy to see that I got some real local advice on my first post.

Hope to hear more from you guys.

I'll post a few screen shots of my Sunlife RRSP funds I can pick to invest in.

Mattzlaff

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Re: Getting Started in Canadian Investing
« Reply #19 on: April 25, 2015, 11:27:59 PM »
Making small changes today haha, no more coffee from timmys on my way to work.

I also had a few questions that I should probably ask my Sunlife people at work but seeing as how its a weekend at 11PM at night and I wont be in to work until next Friday to call using the work phone because I don't want to use my minutes via cell plan, Ill ask here.

Start with the acronyms, my company sure does love them. My company has 4 plans:

A DPSP (Deferred Profit sharing plan) company pays 4% max match of my 7% towards the RRSP/EPSP
A DCPP (Defined contribution Pension plan) company pays 4% or my salary to it this is my pension, I talked to sunlife once they said this is registered but I don't know a lot about it.

An EPSP (Employee profit sharing plan) 7% of my income comes off my cheque AFTER TAXES into the sunlife account
A RRSP money comes off of my cheque BEFORE TAXES and goes into the sunlife account

EPSP and the RRSP are the same thing, I pick which one to contribute my 7% to, the only difference is when I get taxed.

Currently I pay into the RRSP 7% to my company's match of 4% into the DPSP, Although this is fine and dandy I can foresee a headache when it comes to splitting my max contributions between this RRSP account and a self directed account.

So I'm wondering if I should direct the 7% into the EPSP, where I'll be taxed on the money and then, once a year I take that money and direct it into a self directed RRSP. In theory I would pay the same amount in taxes by contributing this lump sum once a year into my own RRSPs as I would by just having a monthly deduction. This would, in theory, relieve the headache that is math on contributing biweekly into my works RRSP and once a year into a self directed RRSP.

Or I can just contribute at the end of the year in December or something and do the math then.

Oh the choices.


Additionally I had a question about this DCPP(Pension) Should I be counting this sum of money towards my savings? When do I actually get to see this money after I retire, if I "retire" at 40 will I get my hands on it?

And on the DPSP, I remembered I talked to sunlife once and they said it was registered. Does this mean registered as an RRSP?

Like I said before I should probably call and ask sunlife myself, I will I just needed to jot the questions down before I forget them a week from now.


RichMoose

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Re: Getting Started in Canadian Investing
« Reply #20 on: April 26, 2015, 07:50:05 AM »
For your work account options, I would only contribute to the account(s) where your employer gives you free money. Usually this is the Defined Contribution Pension Plan under some sort of matching plan such as your 7%/4% split. Don't be tempted to contribute extra money into SunLife accounts, remember they are an expensive option. Also, if the money is contributed to accounts that are not registered (such as in the EPSP you describe), you have to watch carefully for churning because it could mean big tax bills. Generally when companies like SunLife refer to registered accounts they are talking about the RRSP. If on your T4 you get a Pension Adjustment amount, this is a good indicator that it is a RRSP.

There shouldn't be any headache about what you can contribute to your RRSP. On your Notice of Assessment, the CRA automatically calculates for you what you can contribute for the following tax year. I used to use T1213s and contribute to my RRSP throughout the year, but now that I am caught up on all my carry-over room from prior years, my plan is to contribute the full amount to the limit next January or February so I get my money back almost right away when I do my tax return a month later. Earlier in the year (like right now) I am contributing to TFSAs first and then cutting down my mortgage.

Pension contributions are definitely counted as savings. If you pull out of your pension plan, by retiring early or leaving to another job, the money still comes back to you. Usually a portion is in a LIRA-Locked In Retirement Account (really a locked in RRSP) and can't be touched until you turn 55. At 55 you can turn your LIRA into a LIF-Life Income Fund which is basically an account that has mandatory annual withdrawals based on a percentage of assets in that account and your age. Usually it starts at about 4% of assets at 65 years old and increases to 20% when you are 95.

Heckler

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Re: Getting Started in Canadian Investing
« Reply #21 on: April 26, 2015, 08:39:27 AM »
We have a LIRA that came from a previous employers pension plan.  It sucks, because there's only $4700 in the account ( it was a three year job), so only has one holding that's barely reinvesting it's dividends and as I understand it, we cannot contribute more to it.  Lame.

Understand your options.  The best source is your province.

http://www.finance.alberta.ca/publications/pensions/pdf/polbull32.pdf

Heckler

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Re: Getting Started in Canadian Investing
« Reply #22 on: April 26, 2015, 08:45:08 AM »
Shit, thanks!   You just made me understand a LIRA a little bit more.

http://www.finance.alberta.ca/publications/pensions/pdf/polbull24.pdf

I hope I can find BC has the same.


Mattzlaff

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Re: Getting Started in Canadian Investing
« Reply #23 on: April 26, 2015, 10:18:19 PM »
Before I posted for the first time on the forums I upped my contributions from 7% to 8%, I'm knocking it back down to 7% tomorrow because 7% is the minimum to give me the max from the company. With out actually getting into much more than my sunlife contributions I'm saving 15% of my salary yearly (RRSP, DPSP, DCPP). Gotta pay off some debt and that should easily double.

I've never looked into it, but when is the "tax year" for us Canadians? I suppose I should just go to the CRA website...

As far as the whole EPSP goes you're right if there is any increase it is a taxable gain.

I'm curious to see if sunlife will let me transfer my RRSPs from them to questrade when I set up an account sometime in the next couple days. I'll update when I call.


I actually do have a question regarding the TFSA...As I understand, I can only contribute to my maximum yearly, but what happens to anything I actually make on it? For example, and example purposes only. If the max TFSA contribution is 1000$ and I max it out, and invest it into ETF's and make 10% on that in the year, even though that 10% is not taxable income, does it/can I still reinvest it into my TFSA? so that next year I put my next 1000$ in and now I have 2100$? How does that work?

I hope that's a clear question...

I'll try to keep in touch, everyone who's posted here has been a huge help sofar! Thanks again

Heckler

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Re: Getting Started in Canadian Investing
« Reply #24 on: April 26, 2015, 11:33:50 PM »
http://www.cra-arc.gc.ca/tx/rgstrd/tfsa-celi/bt-eng.html

Contributions to a TFSA are not deductible for income tax purposes. However, any amount contributed as well as any income generated in the account (for example, investment income and capital gains) is generally tax-free, even when it is withdrawn.

http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/tfsa-celi/cntrbtn-eng.html

TFSA contribution room
Your TFSA contribution room is the maximum amount that you can contribute to your TFSA.

Starting in 2009, TFSA contribution room accumulates every year, if at any time in the calendar year you are 18 years of age or older, have a valid Canadian social insurance number and are a resident of Canada.

You will accumulate TFSA contribution room for each year even if you do not file an income tax and benefit return or open a TFSA.

The annual TFSA dollar limit for the years 2009, 2010, 2011 and 2012 was $5,000.

The annual TFSA dollar limit for the years 2013, 2014 and 2015 is $5,500.

Note
Under proposed legislation, the annual TFSA dollar limit for 2015 is $10,000.

Investment income earned by, and changes in the value of TFSA investments will not affect your TFSA contribution room for the current or future years. For an example, see Example 1 - TFSA contribution room.

Heckler

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Re: Getting Started in Canadian Investing
« Reply #25 on: April 26, 2015, 11:34:56 PM »
Sunlife HAS to let you transfer out.  However, they can charge a fee to do so.

Mattzlaff

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Re: Getting Started in Canadian Investing
« Reply #26 on: April 26, 2015, 11:42:35 PM »
Thanks Heckler I was just reading the CRA website

Sarnia Saver

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Re: Getting Started in Canadian Investing
« Reply #27 on: April 27, 2015, 09:56:45 PM »
Lots of advice saying to put money into index ETFs.  Great advice when you can find a good online discount brokerage.  However, I have had good luck with my work Sunlife accounts for the pension portion of my investments which have well balanced portfolios, with varying degrees of risk and exposure for a cost of 0.25-0.30.

Also, since ETFs require you to buy whole units through a brokerage, it is a little bit daunting for the novice investor.  Canadian Couch Potato has a low cost mutual fund option through TD bank 'e-series' index funds line that takes a bit of jumping through hoops but offers lots of exposure to CDN, US, INTL and CDN Bond funds at a relatively low cost (0.33-0.51% MER).  Major benefit of a mutual fund is that you can set up a payment plan which invests a small amount each month and basically sets it on auto pilot. Avoid all other Canadian mutual funds besides the e-series from TD as Canada has ridiculous MER on mutual funds.

You can never predict returns, the only thing we can control is how much we pay for the assets we own.  Thats the essence of purchasing low cost ETFs and/or index funds.

GuitarStv

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Re: Getting Started in Canadian Investing
« Reply #28 on: April 28, 2015, 09:36:10 AM »
Our work Sunlife account lists a lot of 'management fees' as 0.25-0.30 as well.  This is NOT equivalent to MER though (MER is actually much higher).  I have made the mistake of assuming they were the same in the past.

Sarnia Saver

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Re: Getting Started in Canadian Investing
« Reply #29 on: April 29, 2015, 03:29:21 PM »
Our work Sunlife account lists a lot of 'management fees' as 0.25-0.30 as well.  This is NOT equivalent to MER though (MER is actually much higher).  I have made the mistake of assuming they were the same in the past.

Interesting.  Thanks for heads up.

Mattzlaff

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Re: Getting Started in Canadian Investing
« Reply #30 on: May 03, 2015, 07:02:20 AM »
The guys at work have mentioned that the company eats a lot of the costs that comes with the savings plan through sunlife. I'll have to see what exact costs the absorb for the plans.

RichMoose

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Re: Getting Started in Canadian Investing
« Reply #31 on: May 04, 2015, 04:41:35 PM »
The guys at work have mentioned that the company eats a lot of the costs that comes with the savings plan through sunlife. I'll have to see what exact costs the absorb for the plans.

Very unlikely, although that might be what they perceive.